Foreign nationals from around the world are not only making the country their new home, but also choosing to start businesses here, ranging from tech start-ups to restaurants. Kunal Doley finds out what lured these ‘expat-preneurs’ to India.
Bertrand Mueller
Co-founder, California Burrito, a chain of Mexican restaurants
WHEN 26-year-old US national Bertrand Mueller was in college, he happened to be in Jaipur for about six months as part of an educational project in 2010. He liked Mexican food, but was surprised at not finding any eatery serving it nearby. Thus was born the idea of California Burrito, a Mexican restaurant, which he started with two of his friends, Dharam Khalsa and Gaelan Connell—both from the US—in Bengaluru two years later.
“That’s what sparked the idea, but overall, I was amazed by the Indian growth story and was excited by the entrepreneurial opportunities evident in the country. I spoke with Khalsa and Connell about it and we decided to go for it,” says Mueller, who believes in serving high-quality, fresh dishes at affordable prices. The restaurant’s speed of service is a boon to its model—it claims to have served as many as 210 customers in an hour at an outlet.
“Indians are used to enjoying freshly prepared food and our format allows for a customisable and quick ordering process. We’ve seen year-on-year same-store growth of over 30% and six of our eight stores have been profitable from the first month itself. We will cross R1 crore monthly revenue in June,” adds Mueller.
As per Mueller, there are more expats working in India now and many of them are also turning entrepreneurs. “I think every ‘business hub’ has a lot of expats. There are great benefits and advantages in trade, be it products, ideas, etc. This dynamic naturally draws foreigners to set up businesses and to engage in trade. It’s what made America. I think more expats will come to India as regulatory burdens reduce and capital controls become less stringent,” he explains.
Technology is what expats are venturing into to avoid some of the challenges inherent in brick-and-mortar set-ups, feels Mueller. “But there are also tremendous opportunities for entrepreneurs to create value in manufacturing and retail. If you can make it through the first year of doing business here, then there are huge opportunities to scale your business,” Mueller offers.
Going forward, California Burrito plans to open two outlets in Chennai in May and expand by next year to Hyderabad, Delhi-NCR, Pune and Mumbai. “We also plan to open additional outlets in Bengaluru. We are in discussion with a couple of partners to take California Burrito to other Asian countries as well, although this is probably going to happen only about two years down the line,” Mueller adds.
Alexander Souter
Co-founder, Overcart, a marketplace for over-stocked, pre-owned products
Alexander Souter was born in France to British parents. Although he studied and worked in a number of countries, he came to India when his UK employer (a consulting firm called CEB) asked him to help build a team of consultants in the country.
“From the moment I landed in Delhi, I knew this was the place for me. I can’t tell you why, but there was this feeling that this would be home. Two years into my consulting gig—my friend and I were running a team of consultants—we decided to quit our cushy jobs and set up our own business,” says Souter, co-founder of Overcart, a marketplace for over-stocked, unboxed, refurbished and pre-owned products.
As per Souter, India is appealing to expat entrepreneurs due to the market size. The over one billion population presents a massive opportunity and so does the rapidly growing Internet penetration (and smartphone adoption rates) in the country. “This will lead to an estimated $200-billion digital economy. It’s a huge number compared to countries like France or the UK, whose populations are 60-70 million people.
The fast-paced economy in India and the general positive feeling since the last election are also helping things a lot. More capital is now available to entrepreneurs than when we first started out,” says the University of St Andrews and University of Edinburgh (both in Scotland) alumnus.
Overcart helps simplify the overall retail supply chain. It helps companies liquidate unsold stock directly to end consumers. From a consumer perspective, it is the place to buy unboxed, refurbished and excess stock products. All products come with warranty, are delivered at one’s doorstep and are available at unbeatable prices. With this business model, everyone wins, as it gives more money back to the owner of the product and helps consumers get great bargains for high-quality products.
“We’ve seen massive growth over the past year and are partnering with e-commerce companies and manufacturers (such as Xiaomi). In terms of customer feedback, the response is overwhelming, our products sell within minutes and we regularly feature on the list of top five trusted e-commerce companies in India on Trustedcompany.com,” explains Souter.
Commenting on his ilk, Souter says he’s seeing more expats set up business in India than when he first started, but he wouldn’t call it a massive influx yet. “There are probably a dozen or so expat entrepreneurs in the tech space in India. I’m naturally seeing a lot more NRIs coming back from Europe and the US to set up businesses, with notable success,” he says.
Overcart has already raised three rounds of funding so far and has warehouses in Delhi and Bengaluru. “We’re looking at continuing our geographical expansion, as well as increasing the size of our team over the coming months, with Mumbai, Haryana and UP as the next target locations. We have a current team of 30 people and are looking to reach 100 by the end of 2015, with a strong focus on technology and quality,” Souter adds.
Greg Moran & David Back
Co-founders, Zoomcar, a car-sharing company
When Greg Moran and David Back, both Americans, gave up full scholarships at University of Southern California’s Marshall School of Business and at Cambridge University’s Judge School of Business to move to Bengaluru and start car-sharing company Zoomcar, hundreds of people told them it would never work. “One objection someone brought up was that car ownership is a huge status symbol in India, so people would prefer to own a car rather than share one,” says Back, co-founder and president, Zoomcar. Two years on, the company’s fleet has expanded to over 800 cars across Bengaluru, Delhi, Gurgaon and Pune from just seven in 2013.
“Greg had some work experience in India and wanted to pursue something in sustainability. I was an incredible car-sharing enthusiast and the rest is history,” says Back.
Back feels the ecosystem here is certainly improving for entrepreneurship and even more for expats who are coming in to tackle major challenges. “People are lured by opportunities of building large companies. India has a huge population base and is rapidly urbanising. Moreover, the middle class is booming. These macro-demographic factors create a great overall backdrop,” he adds.
Comparing the Indian ecosystem with that of the West, Back says it is improving, but this is mainly because it’s much younger. “The US has a 20-year headstart at the least. India is catching up rapidly and can avoid many of the major pitfalls that the US witnessed. This is a nice position to be in for sure,” he says. Entrepreneurship will happen across sectors, but transportation, clean energy, and e-commerce still stand out,
he adds.
Talking about the challenges, Back says, “Early on, we faced substantial regulatory hurdles with governmental permissions. Once this was overcome, we faced various other challenges such as tech deployment, recruiting and supply acquisition. We’ve built up the team considerably in the past few months to help better prepare ourselves for future growth. We work with various partners on the supply front and we’re constantly looking to broaden our base here, so that we can better serve our customers,” Back explains.
Zoomcar is currently present in three cities: Bengaluru, Pune and Delhi/Gurgaon. It plans to enter all tier I and some tier II metros by the end of this year.
Sean Blagsvedt
CEO, Babajob, a job site for urban India’s informal sector
WHEN SEAN Blagsvedt came to Bangalore in 2004 to help start Microsoft Research India, the US national did not have the slightest idea that he would settle down in the country. Eleven years on, he is in charge of a leading job site for urban India’s informal sector—cooks, drivers, cashiers, security guards and delivery helpers, among others—registering over 2.8 million job seekers and adding 2.5 million job positions.
“When I moved to India in 2004, I came across a Duke University research study on poverty alleviation, which provided an ‘aha’ moment—that the primary path out of poverty was income diversification by securing another job. The study also identified that successful income diversification involved ‘knowing somebody’ with access to information about the jobs. This led to the idea for a ‘Village LinkedIn’, which gradually morphed into Babajob.com,” says Blagsvedt.
Launched in 2007, Babajob is free for job seekers and can be accessed by anyone with a mobile phone. By calling 08880004444, job seekers can register with the site and receive SMSes with matching jobs. If job seekers have access to a computer or smartphone, they can also register and search for jobs online or on the multi-lingual app for free. The company has raised Series A funding from Vinod Khosla Impact, Gray Ghost Ventures and USAID.
Blagsvedt thinks people start businesses in India because the country is in the middle of a huge and very exciting transformation. “Mobiles are everywhere. About one-sixth of the world’s population is here and the challenges and opportunities are both colossal. I think that’s exciting to anyone with the ambition to make something truly scalable,” he explains.
Last year, Blagsvedt launched RapidHire, a feature that drives telephone calls from screened candidates to employers in minutes and uses a set of incentives and SMSes to get candidates to appear for interviews. Each RapidHire employer is assigned a recruitment specialist who ensures they get the maximum number of quality applicants for their jobs.
Currently, Babajob operates all across the country. “Our primary focus is on drivers, delivery helpers, retail and Indian-language BPO workers in the e-commerce, retail, call centre and transportation sectors. Our partnership with Facebook in the Internet.org project is also going to give us a boost in reaching out to mobile users who did not have access to the Internet till now,” Blagsvedt adds.
Michelle Bauer
Founder, Good Juicery, a sparkling fruit juice manufacturer
When 33-year-old Michelle Bauer moved to India in the summer of 2011 (when her husband was posted here as part of a company expansion plan), she was struck by a few things—the heat, the culture, great five-star hotels and dining options, as well as the emergence of organised retail. However, she struggled to find natural packaged non-alcoholic beverage options, which were widely available back home in Cape Town, South Africa.
So she decided to set up her own business, Good Juicery. Their refreshing sparkling fruit juices are available in three flavours—sparkling passion fruit, sparkling pink guava and sparkling apple (they have recently launched a sparkling bitter gourd flavour). “We use no preservatives, no artificial flavours or colours,” says Bauer, who lives permanently in Pune now.
Bauer feels it is an exciting time to be an entrepreneur in India. “There is a great sense of community and support,” she says, adding, “Regardless of whether you are a local or an expat, people are extremely responsive to a start-up story. I have countless people to thank for sharing knowledge, contacts and time over the past few years. I am not sure one would encounter such generosity in more established markets.”
Bauer says she is increasingly exposed to more expats who are starting companies in India across a variety of sectors. “Certainly, in our area of premium packaged foods, there are a lot of opportunities, as there is not as wide a variety available on the shelves as one would see overseas—and a lot of what one does find is not made locally,” offers Bauer, who has a background in retail advertising and marketing, working in both South Africa and Dubai before moving to India.
Good Juicery makes its range of naturally refreshing, sparkling fruit juices through recipes and specifications using a carefully selected contract manufacturer. It employs its own sales staff in each market, using distributors to service the accounts, which range from five-star hotels to stand-alone high-end restaurants and retailers such as Nature’s Basket. “The response has far exceeded our expectations. We are now stocked in over 240 accounts across four markets and our production volumes have more than tripled,” she adds.
Based on the positive response, Good Juicery now plans to launch a fourth variant in the next few months. The research and development phase for this is almost complete. It is also planning to launch in new markets beyond Mumbai, Pune, Delhi and Bengaluru.
Rebekkah Kumar
Founder-director, Fourseven.in, an online jewellery company
Rebekkah Kumar has been passionate about jewellery since childhood. Having lived in India for eight years, she saw a definite market opportunity for a line of contemporary, modern and lightweight jewellery for the modern woman. “We all know that the online market in India is exploding. This gave me an opportunity to design, create and bring to life something new and different, and to build a successful online business,” says Kumar, who was born and brought up in the US, but packed bags and moved to India in 2006 along with her family.
Fourseven sells directly to consumers across the country through the website, www.fourseven.in. It also has portions of its collections available through other marketplace channels such as Flipkart, Amazon and Limeroad, and a small footprint for retail consignment as well. “We have enjoyed excellent feedback from all customer segments, including Indian nationals, NRIs and expats. We are seeing strong month-on-month growth both in transactions, as well as registered customers,” says Kumar, an engineer by education. She also holds an MBA from MIT Sloan School of Management in Cambridge, US. She started working with Microsoft Corporation in e-commerce product and brand management in Redmond (Washington) and was with them for nine years before moving to India.
Kumar feels there are more expats in India than ever before. As they see others starting businesses successfully, they will be more willing to venture into setting up a business themselves. “The primary reasons would be market opportunity, as a greater percentage of the population is earning higher wages, so the buying power is greatly increased. At the same time, people are open to new services and products,” she says, adding: “Also, today, there is stronger infrastructure to support the small business entrepreneur, from the availability of skilled resources and shared office spaces, to freelancers and agencies that have structured offerings specifically for small businesses.”
So far, Kumar’s personal experiences have been generally good in India. Setting up the company, getting it registered and managing the basics were straightforward issues. “However, a challenge remains… the core infrastructure to support the contract business agreements is not really in place in any enforceable way. Therefore, as a business owner, it is imperative that we continue to focus on building strong work ethics both internally and with our suppliers and partners at every level of the business in order to create reliable and timely processes across the board,” she adds.